Your Firm Has a Pre-Tax Cost of Debt of 7

question 6

Multiple Choice

Your firm has a pre-tax cost of debt of 7% and an unlevered cost of capital of 13%. Your tax rate is 35% and your cost of equity is 15.26%. What is your debt-equity ratio?

• A) .43
• B) .49
• C) .51
• D) .54
• E) .58

Grasp the impact of outliers on measures of central tendency.

Distinguish between population and sample statistical measures.

Interpret the effect of new data on the mean calculation.

Recognize the formulas for computing statistical measures.

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